By Ali Elias
Abuja, June 26, 2025. The Lubricant Producers Association of Nigeria (LUPAN) has warned that the Federal Government’s proposed import permit requirement for all lubricants could cripple local manufacturing, reverse years of growth, and endanger over 200,000 jobs.
The group issued the warning on Wednesday during a presentation at the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) headquarters in Abuja, urging the agency to suspend the proposed policy.
According to LUPAN, the policy—if implemented—would have devastating consequences on the domestic lubricant sector, which is already operating at less than 30% of its installed production capacity.
“This policy will sound the death knell for existing lubricant plants in the country. It will discourage further investment and roll back the gains recorded in recent years,” the association said in its statement.
LUPAN added that Nigeria has the installed capacity to meet local demand and even produce for export, but the influx of imported finished lubricants has left much of that capacity idle.
Economic Fallout Predicted
The association raised several concerns about the wider impact of the policy, warning of a possible surge in crime due to job losses and economic instability. Among the key points raised:
· Over 200,000 direct jobs could be lost across the value chain.
· Machinery breakdowns may rise due to low-quality, recycled lubricants entering the market.
· Local firms would be forced to compete under unequal conditions—grappling with poor infrastructure, forex volatility, power challenges, multiple taxation, and high bank interest rates.
· The policy could replicate past issues where import licenses for base oil were issued to entities without manufacturing plants.
“We fear many companies could slip into bankruptcy. The policy will hand unfair advantage to foreign products at the expense of local manufacturers,” LUPAN stated.
Appeal to Government’s Economic Agenda
The association argued that the move contradicts the Federal Government’s industrial policy objectives, particularly its Renewed Hope Agenda and Backward Integration drive for the manufacturing sector.
“Every serious country protects sectors where it has competitive advantage. We cannot achieve true greatness by depending on imported goods,” the group said.
LUPAN also expressed concern that government agencies meant to support industrial growth are instead proposing policies that may undermine national economic revival efforts.
“We are disheartened that agencies tasked with enabling businesses are pushing policies that frustrate them.”
Call for Policy Suspension
LUPAN concluded by urging the Authority Chief Executive of NMDPRA to intervene and facilitate the reversal of the proposed policy. The association reaffirmed its commitment to supporting the agency’s goals but stressed that promoting local production must be a national priority.
“Let’s make Nigeria great by promoting our local industry,” the statement concluded.